Summary of Precious Metal Prices in February
| Gamma Polyglutamic Acid |
According to the Commodity Market Analysis System of Business Society, as of February 29, 2024, the spot market price of gold was 480.84 yuan/gram, a decrease of 0.25% from the pre holiday (February 8) gold spot market price of 482.04 yuan/gram. However, this week, the gold price began to slightly recover, rising by 0.36% in the past four days.
According to the Commodity Market Analysis System of Business Society, the average price of silver in the market on February 29, 2024 was 5861.33 yuan/kg, an increase of 1.11% compared to the average price of silver in the market before the holiday (February 8), which was 5797 yuan/kg. However, silver prices continued to decline this week, falling by 0.66% in the past four days.
From November 2022 to early February 2023, precious metal prices significantly increased. From March to the end of April, due to the impact of the US banking crisis, precious metal prices once again entered a period of skyrocketing. Silver prices began to fall in May, while gold remained relatively strong. In June, gold prices hit a high level and silver prices began to rise. After July, gold prices became stronger. In mid to late September, precious metal prices were affected by news from the Federal Reserve, leading to a high level correction. In October, due to geopolitical factors, the risk aversion sentiment rose and continued to rise. In early November, the high range was weak and fluctuated horizontally. At the end of the month, precious metal prices resumed, and silver saw a stronger monthly increase than gold. Silver prices slightly declined in December, while gold prices remained relatively strong. From January to February 2024, precious metal gold and silver fluctuated horizontally at high levels.
Macro data
On the overseas US side, the US GDP data for the fourth quarter unexpectedly revised downwards, and the US economy fell short of expectations. Market expectations for the magnitude of the Federal Reserve’s interest rate cut continue to weaken.
Federal Reserve Director Bauman stated that the time point for starting interest rate cuts has not yet been reached; The latest inflation data indicates a slowdown in inflation progress; Strong economic activity and consumer spending, coupled with a tight labor market; If inflation stagnates or reverses, still willing to raise policy interest rates; Premature reduction of policy interest rates may lead to the need for future interest rate hikes; If inflation continues to reach the 2% target, the ultimate interest rate cut will be appropriate.
Kansas Federal Reserve Chairman Jeffrey Schmid stated that there is no need to adjust policy stance in advance. In terms of interest rate cuts, patience should be maintained to continue observing the economy’s response to previous tightening policies and to seek conclusive evidence that inflation is being controlled.
In addition, the draft G20 Finance Ministers’ Communique shows that G20 finance ministers believe that the possibility of a soft landing for the global economy is increasing, and that a faster than expected decline in inflation is one of the risks.
The market still maintains the expectation of the Federal Reserve lowering interest rates for the first time in June, but the Federal Reserve’s swap rate shows that the Federal Reserve may only cut interest rates by 75 basis points in 2024.
On the domestic side, the central bank has lowered the benchmark loan interest rate LPR again after eight months. The People’s Bank of China authorizes the National Interbank Funding Center to announce that on February 20, 2024, the loan market quoted interest rate (LPR) is 3.45% for 1-year LPR and 3.95% for 5-year and above LPR. The former remained unchanged compared to the previous period, while the latter decreased by 25 basis points compared to the previous period. Lowering the medium – and long-term LPR benchmark interest rate will help reduce the pressure on residents to purchase properties and repay existing housing loans, which is conducive to further promoting investment and consumption.
Future Market Forecast
The dominant tone of precious metals remains unchanged. The Federal Reserve’s interest rate hike cycle is gradually coming to an end and entering a rate cut cycle, which logically favors interest free assets such as precious metals. Although the expectation of immediate interest rate cuts in the short term has weakened, the direction of the cycle remains unchanged. Short term precious metals continue to be affected by inflation data, and long-term support from expected interest rate cuts is still expected. It is expected that in the short term, the price of precious metals will remain high and there is a high probability of horizontal fluctuations.
| http://www.gammapolyglutamicacid.com |